George Bernard Shaw, through his plays, was one of my early heroes. I knew only the good of him then. More recently I have come to learn things, about his political views, that I could have known then but did not, and knowing, would have seen him differently.
Economists often do disagree, but that has not been true with respect to international trade. Ever since Adam Smith there has been virtual unanimity among economists, whatever their ideological position on other issues, that international free trade is in the best interests of trading countries and of the world.
Yet tariffs have been the rule. The only major exceptions are nearly a century of free trade in Great Britain after the repeal of the Corn Laws inthirty years of free trade in Japan after the Meiji Restoration, and free trade in Hong Kong under British rule.
The United States had tariffs throughout the nineteenth century, and they were raised still higher in the twentieth century, especially by the Smoot-Hawley tariff bill ofwhich some scholars regard as partly responsible for the severity of the subsequent depression.
Tariffs have since been reduced by repeated international agreements, but they remain high, probably higher than in the nineteenth century, though the vast changes in the kinds of items entering international trade make a precise comparison impossible.
Producers of steel and steelworkers' unions press for restrictions on steel imports from Japan. Of course, no group makes its claims on the basis of naked self-interest. The result is a serious distortion of the issue. For example, the supporters of tariffs treat it as self evident that the creation of jobs is a desirable end, in and of itself, regardless of what the persons employed do.
That is clearly wrong. If all we want are jobs, we can create any number—for example, have people dig holes and then fill them up again or perform other useless tasks.
Work is sometimes its own reward. Mostly, however, it is the price we pay to get the things we want.
Our real objective is not just jobs but productive jobs—jobs that will mean more goods and services to consume. Another fallacy seldom contradicted is that exports are good, imports bad.
The truth is very different. We cannot eat, wear, or enjoy the goods we send abroad. Our gain from foreign trade is what we import. Exports are the price we pay to get imports.
As Adam Smith saw so clearly, the citizens of a nation benefit from getting as large a volume of imports as possible in return for its exports or, equivalently, from exporting as little as possible to pay for its imports.
The misleading terminology we use reflects these erroneous ideas. What is wrong with this argument? What do high and low wages mean? American workers are paid in dollars; Japanese workers are paid in yen. How do we compare wages in dollars with wages in yen? How many yen equal a dollar?
What determines the exchange rate? Consider an extreme case. Suppose that, to begin with, yen equal a dollar. At this exchange rate, the actual rate of exchange for many years, suppose that the Japanese can produce and sell everything for fewer dollars than we can in the United States—TV sets, automobiles, steel, and even soybeans, wheat, milk, and ice cream.
If we had free international trade, we would try to buy all our goods from Japan.Steel Industry Essay. STEEL INDUSTRY ANALYSIS 1.
Industry trends: Indian and Global perspectives, recent happenings. Steel is the back bone of human civilization, it is very crucial in development of a modern economy. The Online Writing Lab (OWL) at Purdue University houses writing resources and instructional material, and we provide these as a free service of the Writing Lab at Purdue.
Gary Greenberg is a practicing psychotherapist in Connecticut and author of The Book of Woe, Manufacturing Depression, and The Noble Lie.
A Brief Analysis of The Steel Industry Essay example; Mini mills were being used by the foreign competition which mean they were able to produce steel at less expensive rates passing that on ot their customers. Barriers to entry: Starting in the 's since there were no trade barriers companies overseas were able to manufacture and sell.
1. Harold Wilensky put it baldly and succinctly: "Economic growth is the ultimate cause of welfare state development." Harold Wilensky, The Welfare State and Equality (Berkeley: University of California Press, ), p.
2. Thus, Flora and Alber find no correlation between levels of industrialization and social insurance programs of 12 European nations between the s and the s. This free Business essay on Essay: The Indian steel industry is perfect for Business students to use as an example.